HOUSTON — Continental Resources has filed a lawsuit against Hess Corp., alleging fraudulent activity amounting to as much as $69 million, according to court documents. The legal action, lodged in federal court, claims Hess inflated midstream service fees through transactions involving its subsidiaries, impacting Continental’s revenues from oil and gas production wells.
The lawsuit highlights Hess’s operations in the Williston Basin, North Dakota, where it manages approximately 483 wells. Continental Resources, based in Oklahoma, asserts that the excessive fees imposed by Hess Midstream Partners substantially reduced net revenues from hydrocarbons. The company contends that Hess prioritized profits from its midstream assets over the interests of non-operating working interest owners.
Hess Midstream, in which Hess Corp. holds a 38% interest, reported increased throughput volumes last month across various sectors, including gas processing and oil terminals. Despite this growth, Continental estimates that its revenue loss ranges between $34 million and $69 million due to the inflated service costs.
Continental Resources has declined to comment on the ongoing litigation. Hess Corp. has yet to respond to the allegations made against it.
In a related matter, a separate arbitration is set for May 26 regarding the contentious $53 billion acquisition of Hess by Chevron. This deal has sparked disputes between Chevron and ExxonMobil, with the latter having filed arbitration claims over the acquisition, which includes the significant Stabroek Block off the coast of Guyana.
ExxonMobil holds a 45% interest in the Stabroek Block, partnered with CNOOC, which holds a 25% stake. The negotiations and legal wrangling surrounding the acquisition have drawn considerable attention in the energy sector.
This lawsuit and the arbitration proceedings underscore the ongoing complexities and challenges in the oil and gas industry, particularly regarding transactions and partnerships that can significantly affect financial outcomes for various stakeholders.
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